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Also possible a faulty/screwed-up usb driver from microsoft. Check if there is a 'later' driver for update.
I encountered same problem when trying to update the Mars via usb as it was the 1st gen & the only possible method with firmware. I did let it go for a while as I was still able to do stuff in wifi.
Read about another person had similar problem on a newsgroup; decided to check for udates & received an usb update, coincidentally. The usb driver was an outsourced to another company by microsoft.
A bad micro$oft may be "rare" but also worthwhile checking.
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